Supplier News

Hostess files bankruptcy exit, would restructure

After winning important labor relief, Hostess Brands Inc., Irving, Texas, filed a plan to pay creditors and emerge from Chapter 11 protection.

The company won court approval to impose new labor terms on the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union and then filed a plan that would hand most of its ownership to a group of its existing lenders, Silver Point Finance, LLC, which would get a 75% stake in the restructured company, subject to dilution, while its unions would get the remaining 25% stake.

Hostess filed for Chapter 11 bankruptcy protection in January. The company filed a motion Jan. 25 seeking authority to reject collective bargaining agreements with its two biggest unions, BCT and the International Brotherhood of Teamsters. The Teamsters, representing 7,500 of Hostess' 18,500 workers, voted to accept the offer, but the bakers union turned it down. The BCT local voted 39-1 later to reject the company's latest demands for concessions.

The plan, which Hostess indicates will mean "sacrifices at virtually all stakeholder levels” in order to preserve "one of America's oldest and most iconic baking companies," is subject to court approval. Gregory F. Rayburn, Hostess's chairman and chief executive, says that Hostess hopes to exit Chapter 11 in the next few months.

“The plan sets forth the blueprint for Hostess to emerge from bankruptcy," Rayburn states. "We will continue to work toward putting the pieces in place for that emergence so that we can thrive again as a robust competitor and continue to serve our loyal customers for years to come."

The plan incorporates changes to Hostess's operations and balance sheet, and the company plans to close several bakeries, upgrade its delivery fleet and close unprofitable retail stores.

Source: www.foxbusiness.com, wcfcourier.com, www.nypost.com

Did you enjoy this article? Click here to subscribe to Snack Food & Wholesale Bakery Magazine 

You must login or register in order to post a comment.

Multimedia

Videos

Image Galleries

Blue Diamond Almonds Facility

Blue Diamond Almond’s new  processing facility in Turlock, CA.

11/7/13 2:00 pm EST

Food Plant of the Future: The Future of Wastewater Management

Available On-Demand Effective management of wastewater is becoming increasingly critical to food and beverage processors as the cost for incoming water increases...

Snack Food & Wholesale Bakery Magazine

Cover Image

2014 August

This month's publication of Snack Food & Wholesale Bakery takes a special look at Blue Diamond's growers and advanced technology, as well as a tour through the Blue Diamond production plant in Turlock, CA.

Table Of Contents Subscribe

School Lunches

Millions of children will soon be returning to school, lunchboxes in hand. What was your favorite lunchbox treat when you were a kid?
View Results Poll Archive

THE SNACK AND BAKERY STORE

organic-production-&-food-q.gif
Organic Production and Food Quality: A Down to Earth Analysis

Effects of Organic Production on Food Quality is the first comprehensive book on how organic production methods influence the safety and quality of foods, based on an unbiased assessment of the latest scientific findings.  The title is a 'must-have' for everyone working within the food industry.

More Products

Clear Seas Research

Clear Seas ResearchWith access to over one million professionals and more than 60 industry-specific publications,Clear Seas Research offers relevant insights from those who know your industry best. Let us customize a market research solution that exceeds your marketing goals.

The Weekly Mix

Operations Weekly Logo

Written by Snack Food & Wholesale Bakery editors, our Operations Weekly weekly enewsletter provides bakers and snack food manufacturers with up-to-the-minute news, ideas and industry trends.

Sign up today!

STAY CONNECTED

Facebook IconTwitter IconYoutube IconLinkedIn Icon